Al Jazira Capital: Almarai’s profits in line with expectations..These are our recommendations, price target

Al Jazira Capital revealed that the results of “Almarai” company came in line with its expectations and slightly higher than the average forecast of SR 492.8 million, as the net profit grew during the second quarter to SR 520 million, compared to SR 482 million in the same quarter of the previous year, a growth of 23.8%. An average of 8% compared to the previous quarter.

Al Jazira Capital reported that the sales growth for the same quarter of the previous year amounted to 15.1%, supported by the growth in all distribution outlets, products and countries, as the volume of sales of the poultry and bakery sector and price adjustments contributed mainly to the growth of sales.

The total profit rose from the same quarter of the previous year to SR 1.46 million, at a rate of 8.4%, in line with the research company’s estimates of SR 1.53 million.

Al Jazira Capital stated that the operating profit of Almarai Company increased by 7.4% from the same quarter of the previous year, while the ratio of operating expenses to sales decreased by 16.9%, falling below their expectations of 18.1%.

The financial performance of Almarai came in line with the expectations of the research company, as the demand in the export market continued to rise as a result of the company’s sales and product prices, and it expects the gross profit margin to face pressure in 2022 due to the rise in input costs.

Al Jazira Capital believes that the company is able to control operating costs and improve performance during the coming period, supported by its continuation of its expansion plan, focusing on cost and expanding market share.

Al Jazira Capital recommended “Neutral” for “Almarai” share and at a target price of SR 52.